Forecast: 5-year IT market -0.3%

The federal government’s purchases of information technology are likely to decline slightly over the next five years, according to a new forecast by Deltek market research firm.

Deltek predicted that the contractor-addressable federal IT market will shrink from $99.8 billion in fiscal 2016 to $98.3 billion in fiscal 2021. That reflects a negative compound annual growth rate of -0.3%.The largest drop is expected to occur in fiscal 2017, with IT purchases falling to $97.9 billion, followed by a slow rise over the next four years.

“The federal information technology market will remain flat over the next few years as agencies look to lower costs, increase efficiencies and juggle priorities,” Deltek analyst John Slye wrote in an announcement of the report.

“Although the Bipartisan Budget Act of 2015 provided a small funding infusion, agencies continue to face budget pressures, numerous technology and management mandates, and an impending administration change,” Slye added.

Agencies are juggling a number of near-term demands along with pressure to plan long-term strategies, modernize IT environments and streamline contracting and management processes, he said. Meanwhile, the budgetary and political environment are “often ambiguous.”

Priority areas likely to continue throughout the period include cloud computing, data center optimization, cybersecurity, big data and infrastructure modernization.

More Information: Deltek announcement : https://goo.gl/2rnmVq

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